Tax Alert 11

The Secretary of Finance has issued Revenue Regulations No. 4-2018 dated 19 December 2017 to implement the rate adjustment of documentary stamp taxes (DST) as provided
in the TRAIN Law.

The new DST rates are as listed below:

Particular DST rate

Original issuance of shares PHP2.00 on each 200 of the par value; or in case of no-par value based on the actual consideration; or in case of
stock dividends based on the actual value of each share

Sales, agreements to sell, memoranda of sales, PHP1.50 on each 200 of the par value; or in case of no-par value, 50% of the DST paid upon original issuance
deliveries or transfer of shares thereof

Certificate of profits or interest in property or PHP1.00 on each 200 of the face value
accumulations

Bank checks, drafts, certificates of deposit not bearing PHP3.00 on each instrument
interest, and other instruments

Debt Instruments PHP1.50 on each 200 of the issue price

Bills of exchange or drafts PHP0.60 on each 200 of the face value

Acceptance of bills of exchange and others PHP0.60 on each 200 of the face value

Foreign bills of exchange and letters of credit PHP0.60 on each 200 of the face value

Policies of annuities or other instruments PHP1.00 on each 200 of premium or installment payment

Pre-need plans PHP0.40 on each 200 of the premium or contribution collected

Certificates PHP30.00 per certificate

Warehouse receipts PHP30.00 per warehouse receipt (valued at 200 or more)

Jai-alai, horse race tickets, lotto, or other authorized PHP0.20 on every 1.00 cost of the ticket
number games

Bills of lading or receipts PHP2.00 for bill/receipts not exceeding 1,000; or 20.00 for bill/receipts exceeding 1,000

Proxies PHP30.00 on each proxy of voting

Powers of attorney PHP10.00 on each power of attorney; except acts connected with claims due to/from the government
 Leases and other hiring agreements PHP6.00 for the first 2,000 + PHP2.00 for every 1,000 thereafter

Mortgages, pledges, and deeds of trust PHP40.00 for the first 5,000 of the amount secured+ PHP20.00 on every 5,000 thereafter

Deeds of sale, and conveyances and donations of real PHP15.00 for every 1,000 of such consideration/value; transfers exempt from donor’s tax under Section 101 (a) and
property (b) of the Tax Code, as amended by the TRAIN Law are exempted from DST

In case of deeds of sale, and conveyances and donations of real property, when it appears that the DST amount payable has been reduced by an incorrect statement of the
consideration in any conveyance, deed, instrument or writing subject to such tax the Commissioner of Internal Revenue, provincial or city treasurer, or other revenue officer
shall, from the assessment rolls or other reliable source of information assess the property of its true market value and collect the proper tax thereon.

In addition to the DST rates listed above, the new DST rates for life insurance policies, and charter parties and similar parties are as follows:

Life Insurance Policies DST rate

Does not exceed PHP100,000 Exempt

Exceeds 100,000 but does not exceed 300,000 PHP20.00

Exceeds 300,000 but does not exceed 500,000 PHP50.00

Exceeds 500,000 but does not exceed 750,000  PHP100.00

Exceeds 750,000 but does not exceed 1,000,000 PHP150.00

Exceeds 1,000,000 PHP200.00

Charter parties and similar instruments’ registered tonnage DST rate

Does not exceed 1,000 tons PHP1,000 + an additional tax of P100 for each month or fraction of a month in excess of 6 months.

Exceeds 1,000 tons and does not exceed 10,000 tons PHP2,000 + an additional tax of P200 for each month or fraction of a month in excess of 6 months.

Exceeds 10,000 tons  PHP3,000 + an additional tax of P300 for each month or fraction of a month in excess of 6 months.